Have you recently been rejected a checking account due to your past banking blunders? Are you wondering if it’s possible to open a second chance checking account for bad credit? Then you’re surely in the right place.
It happens to almost 10 million US households that they make banking mistakes and earn bad credit. This bad history checked by agencies like the Chex system, later on, hinders them from carrying on any further with their bank accounts and makes them unable to open a new account in a financial institution.
If you have already sullied your good name by committing mistakes like bounced checks or unpaid overdraft fees, you might think it is all over with your banking.
But, luckily, there are some banks catering a second chance for people like you to help develop a better banking history. In the following sections, we will be dealing with such second chance checking accounts, which will be best for you. So stay tuned.
- What Is A Second Chance Checking Account?
- Who Needs A Second Chance Checking Account
- What Is The ChexSystem Report, And What Is The Importance Of It?
- How Do I Clear my Chexsystems For Second Chance Checking Account?
- What Should You Consider Before Opening A Second Chance Checking Account?
- Pros And Cons Of The Second Chance Checking Account
- 7 Best Second Chance Checking Account For Bad Credit Holders
- Bottom line
What Is A Second Chance Checking Account?
Generally, banks check the consumer’s previous history before allowing him an account. And they reject the account-opening applications of people who have unpromising banking history, like unpaid overdraft fees or bounced checks.
But, fortunately, you can get a checking account even after having a negative banking history and also get a second chance credit card with no security deposit. Some banks provide this type of accounts to their consumers as the last chance. This kind of account is known as a second chance checking account and is available in almost all states.
Though a second chance checking account doesn’t supply all the amenities normally provided by the best online checking accounts, they can help reedify your banking history.
Who Needs A Second Chance Checking Account
People who have knowingly or unknowingly committed blunders in banking need a second chance at checking accounts. It is nothing unusual for consumers to make mistakes like bounced checks, unpaid overdraft fees, or carrying an insufficient balance in the account.
When you are put on the blacklist due to an unwelcome banking history, you are badly in need of another opportunity. But it becomes difficult to start a new account when you are charged with bad credit.
But as a matter of fact, a good number of banks come up with this opportunity by the name of Second Chance Checking Accounts. So don’t lose hope.
What Is The ChexSystem Report, And What Is The Importance Of It?
Chexsystem is an account checking agency that provides reports on the customer’s credit to the institution. It keeps track of your account and informs the financial institution of your activities. Depending on the information given by ChexSystems, banks might accept or deny an account application of a particular consumer.
Chexsystem, basically, provides information that is essential to determine the potential risk which a consumer might confer upon the bank. It reports on several topics like negative balances, overdrafts and bounced checks, suspected fraud or identity theft, ATM abuse, and so on.
We have, by now, mentioned that ChexSystems is a check verification system. And, it plays a vital role in deciding whether or not you will be able to open a second chance checking account for bad credit. Therefore, it is essential to be careful with your account activities all the time.
How Do I Clear my Chexsystems For Second Chance Checking Account?
It becomes problematic to open an account in a bank when you have bad credit reported by ChexSystems. But you shouldn’t worry much about that because you can easily clear your Chexsystems for second chance checkings just by following some steps. Now, let’s dive into the process.
The first thing you should do while clearing ChexSystems is to know what is in its report. That’s why you have to request ChexSystems to provide you with a copy of your report. Secondly, check the report thoroughly and see if there is any fund you owe to someone.
Pay off all the debts and charges right away. After that, you should see if someone is mismanaging your account without your permission as a part of identity theft. Take proper steps to get rid of that identity theft.
After doing all the things stated above, you should request creditors to clear your Chexsystems. Then the last thing you should do is to wait until all the information is cleared from the Chexsystem report.
What Should You Consider Before Opening A Second Chance Checking Account?
Everyone wants to get a desirable account when it comes to second chance checking. While choosing the best second chance checking account, you have to concentrate on some crucial factors.
If the factors are perfectly matched with the account you are going to open, choose that one without any delay.
The considerations include minimum balance requirements, monthly fees, opening deposits, and so on. Among them, the five most important considerations are discussed in the following:
Minimum Opening Deposit
When you have a bad reputation in terms of banking history, you might plan to open a second chance checking account that has no minimum opening deposit requirements. Yes, it is possible to find a bank providing customers with a second chance of checking with no opening deposit. But it is not much available.
If you are not fortunate enough to get an account with no opening deposit, try finding one which requires the least opening deposit. As you have to open a second chance checking account for bad credit, you need to choose an account demanding a minimum opening deposit.
Low Or No Monthly Maintenance Fees
There is no denying the fact that second chance checking accounts claim a monthly fee or service fee. But you will be happy to learn that there are some banks like Chime which provide second chance checking accounts without any monthly maintenance fees.
Furthermore, you will find some banks waiving the monthly fees. But you have to abide by their other rules and regulations to avail of that facility.
No Minimum Balance Requirements
Choose a bank account that doesn’t demand a minimum balance requirement. Though it is tough to find a second chance checking account with no minimum balance requirements, you still have to look for one.
And if you don’t get an account without minimum balance requirements, go for one which keeps the balance to its minimum.
No Overdraft Fees
A best second chance checking account is one that requires no overdraft fees. Therefore, choose wisely an account that doesn’t demand any kind of overdraft fees.
Second chance checking accounts tend to charge consumers for overdraft. You might not find an account with no overdraft fees. In that case, choose one that imposes minimum fees for an overdraft.
Free Debit Card
Among all the amenities that a bank account comes up with, a debit card is one of the most desired ones. It facilitates your transaction process and allows you to transfer money from one debit card to another. You can effortlessly transfer money from one place to another using a debit card.
That’s why you should choose a second chance checking account that offers a debit card advantage. Moreover, to grasp the opportunity, you need to know how to transfer money from one debit card to another.
Consider all the five factors before moving on to open a second chance checking account for bad credit.
Pros And Cons Of The Second Chance Checking Account
Everything has its own advantages and disadvantages. A second chance checking account is no exception. There are some commendable and some despairing aspects of second chance checking accounts. Let’s find them out.
- It is providing opportunities for consumers who have scored a bad credit.
- Cheaper than check cashing services
- Offers Possibility to upgrade to a regular account
- It makes it easier for consumers to track their accounts online or using a mobile.
- Most second chance checking accounts come with unavoidable monthly fees.
- No offer for checks, overdraft, or direct deposit.
- Debit card management fees
- Many demanding minimum opening deposit requirements
7 Best Second Chance Checking Account For Bad Credit Holders
Having bad credit doesn’t mean you are ill-fated forever. When you earn an ominous banking history in a financial institution, it’s usual that other banks will refuse to let you open a new account in their Institutes.
Still, you have the last hope of opening a second chance checking account for bad credit. Though bad credit is unwelcome, it’s never a dealbreaker. There are some banks that offer a second chance for people like you having an undesired banking history.
In this section, we will be taking over the seven best second chance checking accounts for bad credit holders. So read the following section thoroughly.
1. Green Dot Bank
- Monthly fees :$7.95
- Minimum deposit requirements: none
- Chexsystem: no
- Overdraft fees: none
Green Dot Bank doesn’t use Chexsystems. That’s why It becomes easier for people having trouble with bad credits to open a second chance checking account for bad credit in this bank. This financial institution requires an amount of $7.95 as a monthly maintenance fee. But it claims no minimum balance requirements or any kind of overdraft fees.
Compared to its contemporaries, Green Dot Bank outrun many other banks. Even if you score badly in ChexSystems and come up with a severely poor banking history, you will be given an opportunity to hold an account in Green Dot Bank.
Furthermore, you can transfer money from Green Dot to PayPal by just using the Green Dot send money feature. In order to avail of that advantage, you must own a Green Dot Card.
Now, as all the seven most prominent second chance checking accounts have been discussed thoroughly, hope you will be able to choose the best one for you among them.
- Monthly fees: $0
- Minimum balance requirements: none
- Chexsystem: no
- Overdraft fees: none
Having no physical branch, Chime is a famous online-only banking platform offering accounts for bad credit holders. Don’t worry even if you have a notorious banking history because Chime is always there to permit you an account.
Now, you needn’t bother about your previous history while opening a second chance checking account in Chime. It’s because Chime doesn’t use Chexsystems. Therefore, your bad credit won’t be able to prevent you from opening a second chance checking account.
Chime lets you edify your past banking blunders and makes you able to hold an account for a long. Plus, chime features a fund transferring facility. You can easily transfer money from Chime to Cash App to use while shopping online.
3. Bank of America
- Monthly fees: $4.95
- Minimum deposit: $25
- Chexsystem: yes
- Overdraft fees: $35
Bank of America is one of the leading second chance checking accounts offering a convenient banking platform to its consumers. Like many other banking institutions, Bank of America uses ChexSystems to check the previous banking history of account seekers.
Still, Bank of America offers second chance checking accounts to those who have bad credits. It’s true that they require some fees and impose some strict rules and regulations.
But if you want to eradicate your past banking blunders and keep track of your transactions, you need to open an account in Bank of America. It is preferred while choosing one of the best ones.
4. Wells Fargo
- Monthly fees: $10
- Minimum opening deposit :$25
- Minimum daily balance requirements: above $1500
- Chexsystem: yes
- Overdraft fees: $35
Despite having all the fees, Wells Fargo can be a better choice for some good reasons. It’s true that Wells Fargo uses ChexSystems to check your previous banking experience. But it doesn’t mean that you won’t be able to open an account in Wells Fargo.
You might not be able to open a regular checking account, but you can go for a second chance checking account in wells Fargo. However, this financial institution charges monthly maintenance fees and demands some other requirements which can be waived easily.
You also have the opportunity to upgrade your second chance checking account for bad credit to a regular checking account in Wells Fargo.
- Monthly fees: $13.95
- Minimum balance requirements: $25
- Chexsystem: no
- Overdraft fees: $35 on average
BBVA is such a banking platform that offers people who are tagged with an infamous history in the recent past. BBVA doesn’t believe that you should be denied an account even if you are a bad credit holder.
It let all the consumers open accounts on its platform and grants them a second chance to develop their banking history. Though it charges monthly maintenance fees and requires a minimum balance, the amount is far lower than many other banks. Plus, it doesn’t use Chexsystems.
6. Radius Bank
- Monthly fees: $9
- Minimum opening deposit: $10
- Minimum daily balance requirements: none
- Chexsystem: yes
- Overdraft fees: $5 a day on conditions
Though Radius uses ChexSystems, you have an opportunity to open a second chance checking account in Radius. As an online banking platform, it provides you with a second chance at banking even if you have a very poor banking history.
Compared to its contemporaries, Radius confers lower fees and affordable charges. If you can afford a monthly fee of $9, you are all set to carry on your finance in Radius. Plus, It offers free online banking and mobile banking.
7. One United Bank
- Monthly fees: $12
- Minimum deposit :$50
- Chexsystem: yes
- Overdraft fees: $37
- ATMs: more than 2,500 throughout the nation
One United Bank is one of the best online banking platforms providing a specially secured United visa credit card. It is a well-known banking service featuring free online and mobile banking.
One United Bank claims an amount of $12 per month as a monthly maintenance fee. Also, it demands a minimum opening deposit of about $50. Though it uses ChexSystems, it is possible to open an account while given a second chance by this banking solution.
These amounts are very much affordable when it comes to maintaining a second chance checking account. Additionally, those fees are lower than the fees required by many other financial institutions.
You don’t necessarily have to get depressed when you earn a poor banking history. It’s a common phenomenon in the US. And what is more usual is that there is a remarkable number of banking platforms offering second chance checking accounts for bad credit.
Therefore, what you need to do is to look for the best second chance checking account to get going with your transactions and other financial matters. And we recommend that you go through the review of the seven best second chance checking accounts stated above before choosing one for you.